Canada GDP (Jul.)

Although the rise in GDP in July was stronger than expected, the preliminary estimate of unchanged GDP in August suggests that the momentum was short lived and puts third-quarter growth on track to surprise marginally to the downside of our already downbeat forecast of 1.2% annualised. With little sign that the economy is accelerating as the Bank of Canada had forecast, we expect that the Bank will cut interest rates by 50bp at its October meeting.